Human Resources Manual - CalHR
1806 - Part-time, Seasonal, and Temporary Employees Retirement Program (PST)
Category
Savings Plus
Audience List
Personnel Officers
Personnel Transactions Staff
Personnel Transactions Supervisors
Synopsis
This policy
Provides information about enrollment in the PST Program
Provides eligibility criteria for PST employees
Provides rules for the PST Program’s distribution options and account closure
Introduction
Under the Federal Omnibus Budget Reconciliation Act of 1990, state and local government employees became subject to mandatory Social Security coverage, unless they are (1) members of a qualifying public retirement system, or (2) covered by an agreement made in accordance with Section 218 of the Social Security Act. In response to the law, the state established the Part-time, Seasonal and Temporary (PST) Employees Retirement Program for certain part-time, seasonal, and temporary employees of the state who are excluded from membership in a state retirement plan. The PST Program is intended to be a “Social Security replacement” plan that provides a qualifying “retirement system” for state employees who do not meet eligibility requirements for membership in a state retirement plan, in order to avoid mandatory Social Security coverage for such employees.
Statement
Enrollment
Employees are enrolled in the PST Program by their Human Resources (HR) Office based on eligibility criteria. PST payroll deductions must post into the employee’s PST account as soon as practicable, but no later than 15 business days after the paycheck was issued that reflects the withholding. HR professionals are required to follow the PST reporting schedule established by Savings Plus to ensure timely deduction posting.
Active participants in the PST program are also eligible to enroll and contribute to the 401(k) and 457(b) Plans. The 401(k) and 457(b) Plans provide the employee an opportunity to invest a portion of their salary on both a pre-tax and Roth basis and provide the employee the flexibility to select from an array of investment options. It is easy to enroll, employees can visit
savingsplusnow.com
or contact the Savings Plus Solutions Center.
Eligibility Criteria
PST Program participation is mandatory for employees who meet the eligibility requirements, unless an exclusion applies. Employees who are eligible for participation in the PST Program generally include the following, if excluded from membership in the California Public Employees' Retirement System (CalPERS):
Part-time employees who work less than half time
Seasonal employees
Temporary and Permanent-Intermittent (PI) employees. Note: Temporary and PI employees are generally not excluded from CalPERS membership if:
They work longer than six months, or
Employed on a per diem basis, they work more than 125 days in a fiscal year (July 1 through June 30), or
Employed on an hourly basis, they work more than 1,000 hours in a fiscal year (hours are accumulative regardless of the number of departments the employee works for).
Half-time California State University (CSU) employees who are not yet eligible for membership in a state retirement system
The following employees are excluded from PST Program participation:
Employees working in multiple positions with the state at the same time and covered by a state retirement system due to a full-time position with the state. Note: this exclusion does
not
apply if an employee has membership in a state retirement system other than CalPERS through employment with a non-state employer.
Example 1: an employee who works in a school district covered by California State Teachers’ Retirement System (CalSTRS), and hired in a state position that is excluded from CalPERS would be subject to the PST Program.
Example 2: an employee who works half-time for the state in a position covered by CalSTRS and hired in a half-time position at CSU that is CalPERS-eligible would be subject to the PST Program.
Example 3: a former state employee who was covered by CalSTRS, and left funds on deposit with CalSTRS, hired at CSU in a non- CalPERS eligible position would be subject to the PST Program.
Employees who retired from service covered by a state retirement system and who are receiving benefits from a state retirement system or have reached normal retirement age under a state retirement system including CalPERS, CalSTRS, Legislators’ Retirement System (LRS), and Judges’ Retirement System (including the Judges’ Retirement System II Law) (JRS).
For example, an employee who was covered by CalSTRS, is age 65, and hired in a half-time position at CSU would be excluded from the PST Program because the employee has reached normal retirement age under CalSTRS.
Full-time students who regularly attend classes in the institution in which they work except during school break periods of more than five weeks, including summer breaks.
Employees hired on a temporary basis in case of emergencies, such as fires, floods, earthquakes, etc. This exclusion applies only to employees hired to perform work requiring immediate action to address the urgent nature of the emergency.
For example, an employee hired to clear hurricane debris to allow access to a hospital meets the exclusion, while an employee hired to work in the Human Resources office to assist in the emergency does not. This means that not all employees hired through the California Office of Emergency Services or under the emergency tenure blanket would meet this exclusion. Employees hired to perform services related to an emergency that do not involve immediate action in response to the emergency should not be excluded from the PST Program.
Election officials and election workers paid less than the annual threshold established by Federal law in a calendar year (for 2017, the threshold is $1,900).
Persons hired through programs to relieve unemployment, such as summer youth programs.
Authorized, nonresident aliens who have F or J visas or M teaching visas.
Persons paid for services performed in a hospital, home or another institution in which they live.
Casual employees who have benefits from the Health and Welfare Fund of their union.
Self-employed persons who render services to the state and make Social Security payments on wages earned from their state contract. To request an exemption from participating in the PST Program, the employee must submit a letter to the HR office indicating they will pay Social Security taxes on the earnings along with a copy of their Schedule SE from their Form 1040 from the previous year.
Contribution Rates
7.5 % of the employee’s pre-tax wages are deducted and deposited into a PST account with Savings Plus. PST accounts do not receive employer contributions or matching funds. The account balance consists of employee contributions and attributable earnings or losses. Note that operating expenses are netted out of the performance of the investments.
Investments
Savings Plus invests PST deductions in the Short-Term Investment Fund-PST (STIF-PST) which seeks to maximize total return consistent with capital preservation.
Account Statements
Savings Plus produces PST account statements twice per year (February and August). Employees may choose to view PST statements electronically by creating a user ID and profile on
savingsplusnow.com
or receive paper statements in the mail.
Plan Limit Coordination
The PST Program is subject to Internal Revenue Code section 457(b). This means that, if the employee elects to contribute to a 457(b) Plan (either with Savings Plus or another employer) in the same calendar year the employee participates in the PST Program, the normal contribution limit that applies to the 457(b) Plan for that year must be reduced by the amount the employee contributed to the PST Program in that year.
Retirement Eligibility Changes
HR professionals must discontinue PST deductions if employees participating in PST become eligible for CalPERS retirement benefits as a result of their state employment.
Account Closure
Separated employees are eligible to take a total distribution from their PST account after 90 days from the last transaction into or out of their PST account. Payments are reported to the Internal Revenue Service (IRS) as ordinary income.
A change in an employee’s retirement system eligibility is not a qualified distributable event under IRS regulations. This means that employees covered by the PST Program who become eligible for coverage under a state retirement system are not eligible to take a distribution from their PST account prior to separation. As described above, HR professionals must discontinue PST deductions when a PST participant becomes eligible for CalPERS. Savings Plus transfers the entire PST account balance to a 457(b) Plan account 75 days after a PST participant becomes eligible for CalPERS. If the employee already has a 457(b) Plan account with Savings Plus, Savings Plus will transfer the entire PST account balance to the existing account. If the employee does not have an existing 457(b) Plan account, Savings Plus will automatically establish one on behalf of the employee and transfer the entire PST account balance. Savings Plus will notify the employee about the transfer and provide information about how to begin contributing to the newly established 457(b) Plan account.
Administrative Fees
Savings Plus charges each employee’s department an administrative fee based on the amount necessary to offset the recordkeeping and administrative costs associated with the PST Program. The amount of the fee is reviewed annually.
Dormant Accounts
Employee PST accounts may be considered "unclaimed" or dormant if no payroll deductions go into or out of the account for two years. Once an account becomes dormant, Savings Plus will send a check in the amount of the account balance if it is less than $1,000. If the amount is a $1,000 or more, it is transferred to the State Controller's Office (SCO), Unclaimed Property Unit after three years from being considered dormant. To claim funds, employees may call SCO at (800) 992-4647 (residents of CA) and (916) 323-2827 (out-of-state or foreign). Employees may "Search for Unclaimed Property" online at
sco.ca.gov
Application
The PST Program is a mandatory program and there is no enrollment application. However, PST participants may enroll in the 401(k) and/or 457(b) Plan online at
savingsplusnow.com
Authorities
457(b) Plan Document
California Administrative Code, title 2, section 599.945.4
Government Code sections 19999.2 to 19999.21
Internal Revenue Code section 3121(b)(7)(F)
Internal Revenue Code section 457(b)
IRS Webpage for Internal Revenue Code Section 457(b) Plans
Omnibus Budget Reconciliation Act (OBRA) of 1990
Treasury Regulation section 31.3121(b)(7)-2
Resources
Forms
PST Benefit Payment Booklet
: PST Benefit Payment Booklet
PST Fact Sheet
: PST Fact Sheet
PML
PML 2001-047
: PML 2001-047 - 10/25/2001 - Part-Time, Seasonal, Temporary Employee Retirement Plan Fee Increase
PML 2004-074
: PML 2004-074 - 12/30/2004 - Changes to Part-time, Seasonal, and Temporary (PST) Retirement Program
PML 2005-023
: PML 2005-023 - 8/1/2005 - Part-time, Seasonal, and Temporary (PST) Employees Retirement Program Statements
Web Pages
www.savingsplusnow.com
: Savings Plus Website
Authorized By
Chief Savings Plus Division
Chief
Savings Plus Division
Contact Person
Savings Plus Solutions Center
To Speak with a Customer Service Representative say "representative", or press 0
Email:
AskSavingsPlus@nationwide.com
Superseded Policies
Not Applicable.
History
View History
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Table of Contents
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1000 - Equal Employment Opportunity
1001 - Equal Employment Opportunity (EEO) Officer Role
1002 - Nondiscrimination Statements
1003 - Bilingual Services
1004 - Reasonable Accommodation for Pregnancy, Childbirth, or Related Medical Condition
1005 - Upward Mobility Program
1007 - Monitoring Qualifications Appraisal Panel Composition
1009 - Employee Demographic Data Collection
1010 - Discrimination Complaint Tracking System (DCTS)
1100 - Selection
1102 - Limited Three-Rank Model
1103 - Human Resources (HR) Liaison Training
1105 - Eligibility Withhold Process
1106 - Job Analysis (JA)
1107 - Limited Examination and Appointment Program (LEAP)
1108 - Steps in the Selection Process
1109 - Policy Resolution Process
1200 - Appointments
1201 - Student Assistants
1203 - Career Executive Assignments (CEA)
1204 - Nepotism
1205 - Military Seniority
1206 - Retired Annuitants
1207 - Hiring Preference for Student Assistants and Internships
1208 - Promotions in Place
1209 - Casual Employment
1210 - Special Consultant
1211 - Criminal History Background Checks
1212 - Temporary Appointments (TAU)
1213 - Unlawful Appointments
1214 - Extension of Probationary Periods
1215 - Rescinding a Job Offer/Refusing to Employ a Person Who Has Accepted an Offer of Employment
1216 - Non-testing Classifications
1217 - Intermittent Employees
1218 - Additional Appointments
1300 - Exempt Employees
1301 - Exempt Employee Salary
1302 - Exempt Lump Sum Payments
1303 - Exempt Out of Class Assignments
1400 - Benefits and Insurance
1401 - Health Benefits
1402 - Affordable Care Act
1403 - Dental
1404 - Vision
1405 - Domestic Partners
1406 - Consolidated Benefits (CoBen)
1407 - FlexElect
1408 - Consolidated Omnibus Budget Reconciliation Act (COBRA)
1409 - Health and Wellness
1410 - State Disability Insurance (SDI)
1411 - Non-Industrial Disability Insurance (NDI)
1412 - Industrial Disability Leave
1413 - Group Long Term Disability Insurance
1414 - Temporary Disability
1415 - Workers' Compensation
1416 - Workers' Compensation Administrative Time Off
1417 - Workers' Compensation Liability Between Departments
1418 - Employee Assistance Program
1419 - Group Legal Services Insurance
1420 - Basic Group Life Insurance
1421 - Supplemental Life Insurance
1422 - Other Post-Employment Benefits (OPEB) Prefunding
1423 - 25-Year State Service and Retirement Awards
1424 - Dependent Re-verification (DRV)
1425 - Bicycle Commuter Program
1426 - Universal Administrative Fees
1427 - Employer Notification Requirements on Premium Assistance Programs
1428 - Employer Notification Requirements – Consumer Coverage Disclosure for Employees in the State of Illinois
1500 - Work Schedules
1501 - Non-Standard Work Schedule Policy for Work Week Group E/SE
1502 - Flexible Work Arrangements
1503 - Alternate Work Week Schedule Policy for Work Week Group 2
1600 - Commute and Parking Programs
1601 - Third Party Pre-Tax Parking Reimbursement Account Program Policy
1602 - Mass Transit Commute Program
1603 - Vanpool Commute Program
1700 - Compensation
1701 - Pay Warrants
1702 - Arduous Pay
1703 - Timely Payment of Wages
1704 - Salary Upon Transfer to a Deep Class
1705 - Safety Footwear
1706 - Managerial Appointments
1707 - Hiring Above Minimum (HAM)
1708 - Computing Overtime
1709 - Seniority Calculations
1710 - Discretionary Salary Action Corrections
1711 - Furlough Program
1712 - Holiday Guidance
1713 - Overtime Compensation (Cash in Lieu of Benefits)
1714 - Part-time Employee Compensation
1715 - Compensation Request Policy
1716 - Timekeeping and Timesheet Submission
1800 - Savings Plus
1801 - Contribution Rates
1802 - Transfer Leave Credits and Catch-Up
1803 - Underfunded Savings Plus Accounts
1804 - Rehired Annuitants
1806 - Part-time, Seasonal, and Temporary Employees Retirement Program (PST)
1807 - Leave Buy-Back, Option to Transfer to Savings Plus 401(k) Plans Enhancement for Fiscal Year 2023/24
1900 - Bona Fide Associations
1901 - Bona Fide Associations Policy
2000 - Collective Bargaining
2001 - Union Notices
2002 - Confidential Designations
2003 - Delegated Agreements
2004 - Union Release Time Bank
2005 - Bulletin Boards
2006 - Decertification
2007 - State Bar Dues
2008 - Personal Services Contract Notices
2009 - Performance Appraisal and Individual Development Plan
2010 - Public Employee Communication
2100 - Leave
2101 - Leave Accounting
2102 - Annual Leave
2103 - Vacation
2104 - Leave Buy-Back
2105 - Sick Leave
2106 - Influenza Season
2107 - Family Medical Leave Act / California Family Rights Act
2108 - Family School Partnership Act
2109 - Holidays for Excluded Employees
2110 - Personal Holidays
2111 - Holiday Informal Time Off (ITO)
2112 - Professional Development Day
2113 - Personal Leave Program (PLP)
2114 - Voluntary Personal Leave Program (VPLP)
2115 - Bereavement Leave
2116 - Catastrophic Leave
2117 - Jury Duty
2118 - Military Leave
2119 - Mentoring Leave
2120 - Pregnancy Disability Leave
2121 - Administrative Time Off (ATO)
2122 - Leave of Absence
2123 - Parr Lawsuit Leave
2124 - Employee Leave Management
2125 - Volunteer Relief Leave Program
2126 - Absence Without Leave (AWOL)
2127 - Covid-19 Supplemental Paid Sick Leave 2022
2128 - National Disaster Medical System Leave
2129 - Reproductive Loss Leave
2130 - Wounded Warriors Transitional Leave Act - Sick Leave
2200 - Travel/Relocation
2201 - Travel and Relocation Policy
2202 - Mileage Reimbursement
2203 - Allowances and Travel Reimbursements
2300 - State Owned Housing
2301 - State Owned Housing (SOH) Policy
2400 - Employee Recognition
2401 - Employee Recognition Policy
2402 - HR Credentialing Program
2600 - Layoffs
2601 - Layoffs
2602 - State Restriction of Appointments (SROA)
2603 - Reemployment
2700 - Retirement
2701 - CalPERS Contribution Rates and Benefit Formulas
2702 - State Safety Retirement
2703 - Peace Officer/Firefighter Retirement (POFF)
2704 - CalPERS 1959 Survivor Benefit Program
2705 - Disability Retirement
2706 - Employer Notification Requirements – Social Security Requirement
2800 - Training
2801 - Leadership Training and Development Requirements
2900 - Workforce Planning
2901 - Workforce and Succession Plan Requirements
3000 - Examination and Hiring
3001 - State Application Filing Guidelines
3002 - Minimum Qualifications (MQs) Calculating Experience & Verification of MQs Prior to Appointment
3003 - Petitions to Participate in Examinations
3004 - Statement of Qualifications
3005 - Using 511B Form
3006 - Examination Announcements and Application Filing Guidelines
3007 - Anonymous Hiring
3100 - Drug-Free Workplace
3101 - Tobacco and Marijuana Use
3200 - Medical Screening
3201 - Controlled Substance Abuse Testing and Treatment Program
3202 - Pre-Employment Medical Examination Selection
3300 - Apprenticeships
3301 - Civil Service Traditional and Non-Traditional Apprenticeship Programs
3400 - Temporary Assignment
3401 - Training and Development Assignment
3500 - Classification Plan
3501 - Establishing and Revising Classification Specifications